Evening Standard (London): Casinos' plans for big prize 'bandits' curbed

CASINO operators were today hit by a Government move to clamp down on the planned liberalisation of the gambling industry that will impose strict limits on the number of Las Vegas-style slot machines they can offer.

The more-cautious approach comes amid widespread concerns about the prospect of so-called "problem gambling" or gambling addiction like that suffered by thousands in Australia after deregulation.

Key to the proposals is a significant scaling back of the number of " onearmed bandits", which are seen by pressure groups as being the most potentially dangerous form of gambling, and by the industry as the most lucrative.

Under its latest recommendations, the Government is proposing that only the huge resort-style casinos currently being planned will be allowed machines with unlimited jackpots.

Even at those destinations, the number will be limited to 25 per gambling table - roulette or blackjack, for example - available on the premises, up to a maximum of 1250.

That was almost half the ratio that the industry had been hoping for and was cited as the main reason for a big sell-off in shares of the quoted casino operators. Stanley Leisure, the biggest player in the sector, saw its shares fall 51/4%, while Rank dropped 51/2% and London Clubs International lost more than 1% of its value. "This looks a lot harsher than we were expecting," said one analyst. "The only good thing seems to be that at least the legislation looks like it will be pushed through quickly."

A UBS broker's note said Rank and Stanley would be hit the hardest, although other pundits noted that the limits could dent the appetite of the queue of overseas companies looking to open resort casinos in Britain.

Meanwhile, small casinos will be allowed only two Pounds 500 jackpot machines for each table while large ones will be allowed five per table.

"The Government makes these proposals because it wishes to limit the accessibility of high-prize machine gaming," said the report.

The Government was responding to a report compiled by a cross- party committee of MPs which recommended it should proceed more cautiously with its proposed deregulation. The Government today accepted 121 of the committee's 139 recommendations.

. MGM Mirage, the gambling group controlled by billionaire financier Kirk Kerkorian, has stepped up its plans to form the world's largest casinos group today by raising its offer for rival Mandalay Resort Group to $7.9 billion (Pounds 4.35 billion). The revised offer, which includes about $2.8 billion of debt, follows Mandalay's rejection last week of a $7.65 billion initial approach. The acquisition would make MGM the largest Las Vegas operator, with a third of all casinos on the city's famous Strip, and about half of the hotel rooms.